It just seems like it happens so often, and airlines will sometimes offer you three times the price of the ticket just to stay a few extra hours. Seems like it’d be easy to just…stop selling tickets once the plane is full??
In: Economics
I’ll use an example to help illustrate this.
You, a traveler for pure pleasure has spent a few weeks tripping around europe. You booked your return ticket well in advance and got a great deal (say $500 because it makes the math easier).
Me, a traveler for work, found out this morning that I need to go to New York for an important client meeting tomorrow. Crap, should have planned better but you know gotta keep the lights on. So I look up flights and lo and behold it’ll be $2000 for the ticket. Boss says go we need you there so I buy it.
We both get to the gate and look at that it’s oversold. So they make the announcement for someone to fly to NA tomorrow instead (the plane is not full so this is easy). You as a pleasure traveler don’t really care so you go up and take the $500 they give you and go to a pub to enjoy your extra day.
Now at the end of the day the airline comes out ahead. I overpaid for the same seat on the plane by $1500, you got $500 and the airline gets $1000 for free.
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